Financial flows and balance sheets of households and non-financial corporations in 2021

Abstract

The Financial Accounts of the Spanish Economy show that the financial situation of households and non-financial corporations strengthened in 2021. Unlike in 2020, households increased their outstanding debt in the form of bank loans, mainly loans for house purchase, in keeping with the real estate market’s greater buoyancy. However, given that household income grew more, their debt-to-income ratio fell by 1.6 percentage points to 91.9%. This remains, however, above its 2019 level. Non-financial corporations’ debt-to-GDP ratio also fell in 2021 (by 4.3 percentage points, to 80%). This was largely due to GDP growth, as their consolidated debt increased slightly. Turning to financial asset investment decisions, households continued the trend of recent years of increasing their holdings of bank deposits and investment fund shares or units, while – in keeping with the recovery in business activity and with lower concern for liquidity risks, respectively – firms granted a higher volume of trade finance and accumulated fewer liquid assets.